Lana has a choice between two different diversified mutual funds. The fund data is as follows. Fund X Fund Y Portfolio return 17% 20% Beta .72 1.2 Standard deviation .9 1.6 If the risk-free rate is 6%, which fund should she purchase and why?A. Fund X should be purchased because of its higher Treynor number.B. Fund Y should be purchased because of its higher Treynor number.C. Fund X should be purchased because of its higher Sharpe number.D. Fund Y should be purchased because of its higher Sharpe number.
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